The lottery is a form of gambling in which numbers are drawn for a prize. Participants pay a fee for a ticket, either electronically or in person, and win a prize if their numbers match those selected by machines. There are many different kinds of lotteries, including those that award prizes for housing units in a subsidized apartment block, kindergarten placements at a reputable public school, and professional sports draft picks. In the United States, state governments and some cities sponsor these lotteries. Other countries have private lotteries, where participants purchase tickets for a chance to win a prize.
Although making decisions and determining fates by the casting of lots has a long history (including several instances in the Bible), the use of lotteries for material gain is much more recent. The first publicly organized lotteries were held in the Low Countries around the 15th century to raise money for town fortifications and to help the poor. By the 19th century, these had become popular enough to be able to support several American colleges, including Harvard, Dartmouth, Yale, King’s College (now Columbia), and William and Mary.
Across the United States, dozens of state lotteries operate. Almost all of them follow the same basic pattern: the state legislates a monopoly for itself; establishes a government agency or public corporation to run the lotteries; starts with a modest number of relatively simple games; and, under constant pressure to expand in order to raise revenues, progressively adds new games.
Most state lotteries are designed to appeal to the same audience: people who enjoy watching and speculating about the winning numbers. This audience is largely defined by demographic characteristics and the state’s tax structure. The most significant factor in a state’s decision to adopt a lottery, however, is the level of public demand.
The success of state lotteries has generated a great deal of public discussion about the desirability of such schemes. Criticisms vary, but they generally fall into one of two categories. The first focuses on the problems associated with compulsive gambling and the alleged regressive impact on lower-income groups. The second concerns the cyclical nature of lottery operations: revenue growth expands dramatically after the lotteries are established, then levels off and even declines. In order to raise these revenues, state lotteries inevitably introduce new games, and this expansion is often accompanied by increased promotional activity.
Lottery advocates argue that the game is beneficial for states because it provides a source of public funds that would otherwise not be available. Nevertheless, I have never seen any analysis that places this claim in context of overall state funding. What’s more, the message of lottery advertising is essentially that if you buy a ticket, it’s your civic duty to donate to the state and its children.